NASSAU, BAHAMAS — Prime Minister Philip Davis KC says the government’s overhaul of the country’s electricity sector is aimed at fixing long-standing structural problems at Bahamas Power and Light and creating a more reliable and affordable energy system for Bahamian households and businesses.
Speaking at the Energy Reform Stakeholder Forum on Thursday, Davis said the administration inherited an electricity system weighed down by heavy debt, aging infrastructure and costly temporary measures that left the country vulnerable to blackouts and rising power costs.
“For many years, Bahamians have been saying the same thing: fix the power problem. Fix the blackouts. Fix the high bills. Fix the confusion around BPL,” Davis said.
He told stakeholders that when the government came to office, BPL was carrying around $500 million in debt, while the government was spending more than $50 million annually to subsidise electricity in the Family Islands.
“In many of those islands, the true cost of producing a single kilowatt hour was not the twenty or thirty cents people see on their bills, but in some cases between the high thirties and the nineties once fuel transport, labour, and the inefficiency of tiny systems were counted,” Davis said.
The prime minister also noted that the utility was renting about 32 megawatts of generation at a cost of roughly $40 million a year, while more than 80 percent of existing engines were expected to reach the end of their working lives within five years.
“Immediate replacement needs were more than eighty million dollars before we added a single panel of solar or a single battery,” he said, adding that millions more were being spent annually on sludge handling, environmental cleanup and emergency repairs.
Davis said the government’s “New Energy Era” reforms represent the largest restructuring of the electricity system since the country was first electrified.
“It is ambitious, complex and long-term, and it is designed with a very simple aim in mind: to give Bahamians a power system that works,” he said.
A key element of the plan is moving the country away from rented engines to permanent modern generation, which the prime minister said will ensure the money consumers pay each month helps build long-term energy assets within The Bahamas.
“For years, the country paid tens of millions of dollars to use equipment that did not belong to us. Those rentals were a sign of a system stuck in crisis,” Davis said.
The reforms also include introducing liquefied natural gas (LNG) into the energy mix alongside a hedging programme designed to stabilise fuel costs. According to Davis, the structure could lead to projected savings of about $97 million for consumers in the fuel portion of electricity bills once fully implemented.
The government is also expanding utility-scale solar and battery storage systems across the islands, creating hybrid microgrids designed to reduce reliance on imported diesel and heavy fuel oil.
“Every unit of energy produced by the sun replaces imported diesel and heavy fuel oil,” Davis said. “That means less vulnerability to global oil shocks, fewer emissions, and systems that can restart and recover more quickly after a storm.”
Another major component of the restructuring is the creation of Bahamas Grid Company, a new transmission and distribution company in which BPL will hold a 40 percent stake.
The prime minister said the grid company’s tariff structure includes funds set aside annually for hurricane restoration and for paying down BPL’s legacy debt.
“When storms hit, and poles and lines are damaged, this is the mechanism that allows us to respond faster and more systematically,” he said.
Davis also highlighted transparency as a central part of the reform process, noting that the government has already released more than 3,000 pages of energy agreements and supporting documents, including power purchase agreements, tariff models and regulatory approvals.
“Energy policy is too important to be hidden. It affects every home, every business, every clinic, every school,” Davis said.
He added that the reforms are designed not only to stabilize the electricity sector but also to support long-term economic growth.
“A modern energy system is our ability to grow and compete,” Davis said. “Manufacturers will not invest where power is unreliable. Hotels cannot deliver world-class service when they live in fear of outages. Digital businesses cannot thrive without constant, stable electricity.”
The prime minister acknowledged that the reforms are ambitious and complex but said the government’s goal is clear: to move the electricity sector away from what he described as a “permanent crisis” and toward a stable long-term system capable of supporting the country’s development.
